If you have nothing left to pay non-priority
debts, you must say so. Show your creditors by sending them
your financial statement.

A financial statement is the document
sent to creditors to represent your financial circumstances. Great
care must be taken to ensure it is fair and correct. From the
financial statement you will be able to calculate whether or not
there is any income to make offers to non-priority creditors.
Contact debt advice charities for further help.

Manage your expenses

When you are in debt and owe creditors, you should work out how
much money you have to pay out each month on basic living expenses
first. This will ensure you have enough money to pay for items such
as food and fuel. You should include these on include these on
your financial statement.

Look around for good deals and cut costs where you can:

Council Tax - Check whether you are entitled
to help to pay your council tax and see if you
can pay in weekly or monthly instalments. Many councils ask for the
amount paid over 10 months rather than 12

Water charges - Water companies may accept
weekly or monthly payments rather than half yearly

Gas and electricity - Work out the cost of
your bills over the year. Divide by 12 if you are budgeting
monthly. You can ask to pay by budget scheme or have a meter
installed. Ask your local council about home insulation grants. If
you are on Income Support or Job Seekers Allowance (JSA) you can
pay for your arrears by Fuel Direct

Food and household items - For food, put down
the amount you spend on your weekly shopping. You should also
include the cost of household items, for example, washing powder,
soap, shampoo, toothpaste, sanitary towels and razors. If you are
not sure exactly how much you spend on food and household items,
allow about £20 per week for each person who lives with you.
However, if you or anyone else who lives with you needs a special
diet (for example, a diabetic) or has other special needs, you will
need to increase this amount. You should explain this on any letter
you write to your creditors

TV licence - Spread the cost of your colour TV
Licence in weekly or monthly payments, from as little as £5.60 per
week. Visit the TV licensing website to find
out more

Essential travelling expenses - These should
include travelling to work, school and for shopping. If you are
running a car, include the cost of tax, insurance, repairs, MOT
and servicing as well as petrol

Clothing - Look at your clothing expenses over
a year. Only include non-dependants if you pay for their clothing.
Remember to include school uniforms. As a rough guide, allow £5 per
person per week.